India’s crude oil sourcing strategy has shown a clear shift toward lower-risk and more execution-reliable supply, with the Middle Eastern barrels gaining share as Russian crude flows remain present but increasingly selective and compliance-driven.
Import of Russian crude oil dropped to around 1.1 million barrels per day in the first three weeks of January, from an average of 1.21 million bpd in the previous month and over 2 million bpd imports in mid-2025, according to data from real-time analytics company Kpler.
India, which is almost 90 per cent dependent on imports to meet its needs for crude oil — the raw material which is turned into fuels such as petrol and diesel in refineries, is again leaning on its traditional suppliers in the Middle-East.
Iraq is now supplying almost the same volumes as Russia, up from an average of 9,04,000 bpd in December 2025, according to Kpler data. Volumes from Saudi Arabia too have risen to 9,24,000 bpd this month, from 7,10,000 bpd in December and lows of 5,39,000 bpd in April 2025.
Russia displaced Iraq as India’s top crude supplier in 2022 after Indian refiners moved quickly to buy heavily discounted Russian oil that was left stranded when Europe and other Western buyers turned away following Moscow’s invasion of Ukraine. Russian crude rose from under 1 per cent of India’s imports to roughly 40 per cent at its peak.
Fresh US sanctions on Russian suppliers, however, have triggered a slowdown in purchases as compliance and execution risks rise.
“India’s crude buying in January 2026 shows a clear shift toward lower-risk and more reliable supply, with Middle East barrels rising while Russian crude flows remain present but more selective and compliance-driven,” said Sumit Ritolia, Lead Research Analyst, Refining & Modeling, Kpler.
Energy security and diversification are shaping the narrative — but refinery economics still drives the decision-making.
“India will likely keep buying of Russian crude in early 2026, but at a slightly lower level than the record highs seen in 2023-2025. The pullback looks more like a short-term disruption from compliance issues rather than India moving away from Russia completely. It’s just a near term realignment, nothing else in my view. Russian crude is economical and remains a driver for refinery margins,” he said.
India’s Russian crude purchases in January 2026 and across Q1 2026 are expected to average around 1.2 million bpd (January) and 1.3-1.5 million bpd (Q1), he said.
Following the US sanctions on Rosneft, Lukoil and their majority-owned subsidiaries taking effect on November 21, refiners including Reliance Industries, Hindustan Petroleum Corporation Ltd (HPCL), HPCL-Mittal Energy and Mangalore Refinery and Petrochemicals (MRPL) temporarily halted Russian imports. The only exception is Rosneft-backed Nayara Energy, which continues to rely heavily on Russian crude after EU sanctions curtailed alternative supplies.
“India has increased crude imports from the Middle East over the last 2 months, while Russian volumes have declined as sanctions and compliance pressure have intensified,” Ritolia said. “This reflects a mix of changing economics and rising execution complexity around Russian crude, including shipping, insurance, payment pathways, and compliance screening.” The result is a clear rebalancing of India’s crude slate, with the Middle East inflows rising as refiners prioritize supply reliability, flexibility, and smoother cargo execution. This shift also supports operational stability for refiners that prefer predictable supply chains and fewer downstream constraints.
Indian refiners such as Indian Oil Corporation (IOC) and Bharat Petroleum Corporation Ltd (BPCL) are buying Russian oil from non-sanctioned entities. There are indications that Reliance too may soon resume purchases from non-sanctioned entities.
That is primarily because Russian crude remains compelling on price. Urals is currently trading at a significantly wider discount than earlier in the fourth quarter, with differentials around $5-7 per barrel below Oman/Dubai grades on a delivered basis to India, compared with roughly $2-4 per barrel before late November. This places Urals around $4-5 per barrel cheaper than its pre-reset range, continuing to support refinery margins where compliance risks can be managed, Ritolia said.
Published on January 25, 2026
